Blockchain Traceability – Tipping The Farmer From The Restaurant

Have you ever wondered who is the real person behind that delicious meal you relished at your favorite restaurant? Is it the chef who came up with that imaginative recipe or the cook who skillfully put it together? Is it the agricultural processor who seasoned the key ingredients or the distributor who kept the produce fresh? What about the farmer who made all these possible? The farm-to-fork supply chain is long with many players, yet consumer appreciation seldom travels past the end player.

What if we could identify the little guys at the beginning of the value chain from the shadow of the big brand at the end of the value chain? What if we could create an identity for that little farmer and let them own and monetize their product throughout the value chain, not just from the retail dealer? What if we could tip the farmer from the restaurant? It requires us to create end-to-end traceability of produce chain-of-custody.

What is Traceability?

Traceability means the ability to follow chain-of-custody along the supply chain. The chain of custody records the product sequence details at each business point as the product transforms into a finished product through a supply chain. Examples of chain-of-custody documentation include the origin certificate, package information, quality certifications, record of time and custody, temperature along with shipping, and export and import documents. A credible chain of custody system improves the truthfulness of product claims.

The technology behind Bitcoin – blockchain – provides a foundation of trust. Blockchain offers a set of guarantees with the immutability of data and business logic that minimize the prerequisite of trust between individual parties. Trust is the most critical brand asset one manages, especially in relationships with customers, suppliers, employees and other stakeholders. Blockchain creates trust in business relationships through its support for immutable shared data, consistent logic (via smart contracts) and governance. The immutability is achieved by an append-only ledger, driven with a consensus protocol over a distributed network.

The ledger groups data into blocks and links them using cryptographic hashes with previously filled blocks forming a chain of blocks and recording them across distributed computers in the network.

How to create blockchain Traceability?

Blockchain, known for creating decentralized, immutable records, is a natural choice for recording a chain-of-custody information trail. The distributed shared ledger records every transaction in a supply chain by integrating entire ecosystem players to access and submit data. The food supply chain can integrate data on farmer information, seed information, pesticides & fertilizer information, the time of the harvest, packing, shipping, and sale to consumers.

Smart Contracts can cross-validate the data against the fundamental assumptions to avoid fraudulent data. In addition, multiple trusted verifiers and validators can vouch the uploaded data. This creates transparency and visibility throughout the supply chain - consumer may trace their food from “farm to fork” by scanning a QR code and act on it!

How about Privacy? What if the middleman buying from the farmer knows about the tips the farmer is receiving? Will he reduce the price? Enterprise blockchain offers privacy, which at a high level encompasses confidentiality and anonymity. Data isolation methods in blockchain ensure confidentiality to conceal the transaction details prevents anyone else from knowing the details of payments.

Similar approaches and zero-knowledge proofs (ZKP) are used to achieve anonymity to hide the parties of the transaction. ZKPs algorithms allow verification of a transaction or data without exposing the transaction details to parties.

Blockchain traceability possibilities are endless. The global visibility of enterprise assets and products in transit and storage is a fast-growing technology. In a supply chain, blockchain-based traceability has the potential to track product origin (provenance), trace supply chain activities, enable ethical and sustainable practices, reduce carbon footprint, identify counterfeits, prevent pilferage, ease paperwork processing, and enable trust on the end-to-end ecosystem.

Examples of blockchain traceability’s early adoption in the supply chain includes IBM Food Trust, which connects all food industry players; Tradelens, which connects all shipping ecosystem players; and Circulor, which enables sustainable mining industries.

Blockchain is just one of the enablers. Along with blockchain, a typical solution includes IoT, GPS, RFID, other location technologies, oracles, and integration with existing systems. As per the research & markets report, the blockchain supply chain traceability market is expected to grow from $253 million in 2020 to $3,272 million by 2026.

It is now time for supply chain executives waiting and watching on the sidelines to assess the blockchain potential for their businesses! At this stage, companies that are not already developing a blockchain integration strategy are at risk of being left behind.

(Gigo Joseph is the vice president of blockchain services at Chainyard)